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Brexit: Liam Fox accuses EU of trying to 'blackmail' UK over divorce bill

Government frustration with the Brexit talks have boiled over with Liam Fox accusing Brussels of trying to "blackmail" the UK into agreeing a Brexit bill.

Speaking about the European Union's insistence on agreeing a bill before moving on to trade talks, the International Trade Secretary told ITV News: "We can't be blackmailed into paying a price on the first part [the divorce bill].

His comments came as the EU's negotiator Michel Barnier said there had been no "decisive progress" on key issues relating to Britain's withdrawal from the bloc.

Michel Barnier (right, with Brexit Secretary David Davis) said on Thursday no Credit: AP

"We think we should begin discussions on the final settlement because that's good for business, and it's good for the prosperity both of the British people and of the rest of the people of the European Union."

After talks in Brussels failed to make significant progress on the size of any final payment, it is looking less likely that the UK's ambition to start trade talks this autumn can be realised.

Dr Fox was speaking before the British delegation left Tokyo having secured Japanese agreement to model a future UK trade deal on the EU deal that is already in train; a small success, but a significant one.